The time is always right

At Westmount, we have the privilege of advising families who have built significant multigenerational wealth and are intentional about preparing their children to carry forward their legacy. Many parents wonder when they should speak with their children (and sometimes grandchildren) about their wealth. Ultimately, every family is unique, so these conversations are shaped by the individual values and vision of the family: when, where, and how often.

As a parent myself, I’m passionate about this topic. I’ve come to learn that it’s never too early to speak to your child about money, and it’s never too late.

How to talk with children and teens about money and wealth

There are many different ways to introduce healthy financial habits, recognizing that each family’s values and goals are distinct. The approach that resonates with one family may not be the right fit for another.

When your children are young, start with the financial basics: the differences between a stock and a bond, for example, or the uses of a checking account versus a savings account. It’s also a good time to mention the role that taxes play—that a $25 gift card won’t necessarily buy $25 of merchandise after taxes are added to the subtotal.

Some parents like to use an allowance system to provide children with the opportunity to save toward goals or develop an early budget. Others take a less structured approach by giving monetary gifts for birthdays, graduations or other important milestones.

Sometimes children will approach their parents about earning money by doing extra chores or earning good grades. If your teen has a job, you can point out that federal and state taxes will be taken out of their earnings and help them create a budget to save for a new car or other wishlist item.

You may want to establish some goals for these inflows: a percentage saved, a percentage spent, and a percentage given to charity. If your children have a favorite cause, encourage them to identify and learn about the nonprofit organizations making a difference in their community and consider where their philanthropic support can have the greatest impact.

Modeling the values you want to impart on your children is important. It may not be appropriate to share the amount of donations you give to support favorite causes or charities, but sharing your passion for a particular cause or charity can be a meaningful way to engage your family to develop shared values.

During these early years, conversations about finances can take place at any time—at the dinner table, while you’re driving your children to their activities, checking out at a grocery store, playing a game of Monopoly, or any moment that feels right. The important point is to engage regularly, helping your children start early in understanding the basic tenets of money and financial decision-making.

What financial responsibilities should parents discuss at age 18?

At 18, your child is a legal adult. This milestone introduces some restrictions regarding the oversight of your child’s affairs. For example, you will no longer be able to call a financial institution to obtain details about your child’s bank accounts.

Around this age, your child may be heading off to college and living on their own for the first time. It can be a good time to speak with them about managing their finances, including credit cards, spending, and budgeting.

If your child is responsible for paying a credit card bill, explain the importance of paying the balance on time. Help them understand the importance of building a strong credit history and the role credit plays when applying for an apartment, buying a car, or taking out a mortgage.

How to talk with adult children about inheritance and family wealth

As your child moves into adulthood, it becomes increasingly important to have ongoing conversations about your intentions for your family’s wealth. These discussions are not simply about what your children may one day inherit, but about helping them understand the purpose behind your success and the responsibilities that accompany it.

By sharing your experiences, your principles, and your intentions over time, you can prepare the next generation to both receive your wealth and steward it thoughtfully, preserving both your family’s legacy and the values that define it.

There may be no “perfect moment” to initiate these conversations; perhaps you go to lunch together, take a walk, have a spa day, or discuss while making dinner. Whatever the opportunity, it’s a good time for you and your child to speak about what wealth means to you and to them.

You can begin at a high level by discussing your philosophy on wealth, the approach that guided your financial decisions, and the discipline that enabled you to build your wealth. Over time, those conversations can naturally evolve into more detailed discussions.

Should you share your estate plan with your adult children?

Sharing your estate plan in broad terms with your children also provides an opportunity to discuss far more than the distribution of assets. An estate plan is not merely a set of legal documents but rather an expression of a family’s values and vision for the future.

Inviting your children to ask questions and share their perspective fosters trust, deepens understanding, and creates a shared sense of purpose. When family members understand the intentions behind your planning, they will be better prepared and more committed to honor your wishes and carry your legacy forward.

As your children become more engaged, introduce them to your trusted advisory team and invite them to participate in family financial discussions. Giving them insight into how important financial decisions are made prepares the next generation to make informed decisions with confidence and purpose.

How families can prepare heirs to manage wealth responsibly

Preparing heirs is an ongoing process of education, engagement, and relationship-building. There is no universal blueprint for how families should engage in wealth discussions. Talking about money can feel uncomfortable, even within the closest families. But avoiding the topic rarely leads to the right result in cultivating responsible stewards of wealth.

Your Westmount Advisor can act as a thoughtful advocate. Having guided many families through the process of preparing the next generation for wealth, your Westmount team can offer thoughtful perspective and practical guidance to help your family approach these conversation.

Together, we can navigate the complexities and sensitivities of discussing wealth with your children. The “right time” is before you: it’s never too early, and it’s never too late.

Our Wealth Strategy team is always available to support you in these conversations. Give us a call at 310-556-2502 or email advice@westmount.com to speak with an advisor.